When it comes to making the move to SaaS, the question for most organizations isn’t so much “if,” as it is “when”—and “to what extent.”

FEARING LOSS OF CONTROL

One of the challenges many companies considering SaaS face is a loss of control. Jeff Muscarella, executive vice president with spend-management consultancy NPI Financial, says this manifests itself initially during contract talks. The way to avoid being disappointed, he says, is to be very specific about your company’s needs.

“In a lot of these agreements, the starting point comes from the vendor,” says Muscarella. “The [agreements are] typically not as well developed as they should be if you want to be safe as the buyer.”

As in the traditional software market, smaller companies carry less weight with vendors, he says, making it even more important that they ask hard questions—both of their vendors and within their organizations—about what the service does (or should do) and what the service-level agreement covers (or should cover).

MAKING PLANS, INTERVIEWING USERS

The state of Oregon did a lot of internal soul-searching before it looked for a statewide collaboration platform. Before beginning its search, state IT executives talked to various agencies about what they’d want out of a collaboration app, and what business processes it would support. “They know the business processes best and can apply the technology best,” says Wally Rogers, Oregon’s e-government manager.

Ultimately, the state selected Jive Software’s enterprise social networking platform as the foundation for Oregon GovSpace, which enables state agencies to collaborate—not just with each other, but with citizen groups, employees, vendors, private industry, counties and advisory committees. The platform was an especially good fit for an IT organization that doesn’t have a central application-development group, yet increasingly needs powerful tools to deliver data and knowledge throughout the enterprise.

“For us, SaaS is perfect,” says CIO Dugan Petty. “The data sets with open APIs allow developers to do mashups so we can see data in different ways, and it gives users control over how they view and tabulate data.”

Launched in 2008 with 200 users, Oregon GovSpace today has more than 5,000 users from more than 40 state agencies and 190 other organizations. They use the SaaS platform for document sharing, project management, communications, crowd-sourcing and knowledge retention—all while being able to customize it much more than is typical for a state government application.

The way Petty sees it, the success of Oregon GovSpace is due—more than anything else—to something all good SaaS apps share: People like using it. And the more they like using it, the more they’ll get others to use it.

“Growth tells us it’s a great solution,” Petty says. “It gives people a work tool that doesn’t feel like a work tool.”

That’s not to say there haven’t been lessons learned. For instance, Rogers says the initial cap of 200 users the state set for the first incarnation of Oregon GovSpace was too small for an organization of 40,000 people to get true insight into collaboration capabilities. If he had it to do again, Rogers says he’d start with a sample size closer to 1,000 users.

As a result of its experience with Oregon GovSpace, the state now has SaaS strategy guidelines dictating that any agency considering a cloud-based app must take steps to ensure that the app meets its business needs, as well as determine whether the app makes sense to deploy across the statewide enterprise.

Consider the time it takes to prepare such guidelines a small ante—one that any company with SaaS in its sights should be prepared to invest.